Tag Archives: John D. Rockefeller

Most people know that monopolies are illegal, but not everyone understands the history of antitrust and collusion laws or why they exist at all.

As a libertarian, I basically support free market capitalism and laissez-faire, but why do we libertarians and other liberty minded people support this? Because free people who run free enterprise are free to innovate and this innovation brings us a superior product. Competition among innovators also drives down the price as they seek to gain market-share. It’s why you can get a miracle of modern technology like the iPhone or Droid for a mere pittance—with a 2-year contract anyway.

U.S. Steel – Youngstown Ohio

But if we look at the history of monopolies here in America, Standard Oil and U.S. Steel were the most popular in our history, and what transpired was not good. Thus making the case for some semblance of government oversight.

I am often berated by anarchist-like libertarians for championing even the most minor government regulations in our marketplace, ensuring they compete and that they don’t violate our rights, but these people are ignoring historical evidence to promote an ideal I agree with, yet know doesn’t work if left unchecked. History has already proven it. Just because none of us were alive during that era, doesn’t mean we don’t have the documentation to know what happened when we had market-anarchy.

Standard Oil Common Stock

Prior to antitrust and collusion regulations, the quality of goods from these trusts was poor, the working conditions were so atrocious that workplace deaths and injuries were quite common, and the cost of what came off the production lines wasn’t cheap. Why would it be? If you’re the only game in town, providing a quality product, safe work environment, and competitive pricing and wages, simply aren’t needed. Just as absolute power in government corrupts, absolute power in business corrupts too. The moment a business owner needn’t fear people buying from his/her competitor because no competitor exists, corruption can, and likely will, be born.

Anarchists argue that if workers don’t like it, they can go work somewhere else. But where do you propose people go work? The very definition of a monopoly is that it’s the only business in an industry. Thus, there is nowhere else to work. If an enterprising person attempts to go into business for themselves, they’re either forced to sell to the monopoly, or crushed by it if they don’t. These are not wild conspiracy theories I’m floating, it’s historically documented evidence.

The design of free-market capitalism, is not dissimilar to socialism or anarchy. In a perfect world, they would work as intended and yield the desired positive result. History has proven however, that they also have the same flaw. There will always be sociopaths among us who don’t have the power of empathy or value the benefits of being societal. The only decent way mankind has ever dealt with these people is via rule of law. Such people have no qualms about taking advantage of others and doing them harm for personal gain. Our Constitution is designed to prevent these people from corrupting our government, and competition should prevent them from corrupting our markets. So ensuring competition is vital to our society, our rights, and our economy.

Andrew Carnegie, Cornelius Vanderbilt, John D Rockefeller

John D. Rockefeller, J.P. Morgan, and Andrew Carnegie proved that there’s a point at which if you do something right, you can control an industry to such an extent that no one else can compete. These men were likely decent people who considered themselves altruistic and good, but the unfettered power they eventually wielded corrupted them in such a way that they became consumed with winning and had little issue engaging in immoral practices to accomplish this goal.

So aside from protecting our rights to life, liberty, and property, in my opinion, government should justly be ensuring our markets stay competitive and uncorrupted.

So now that we understand, and hopefully agree with regulations preventing monopolies, I’d like to point something out:

Government is a monopoly!

The federal government competes with no one. State and local governments may seem to compete with each other, but if you live in Ohio and don’t like the service the Ohio government provides you, you can’t choose to do business with the Virginia government unless you move to Virginia. It’s quasi-competition at best where states compete to lure residents and businesses, but it’s certainly nothing like Apple versus Microsoft or Ford versus Chevrolet.

So when people like me beg and plead voters to elect more libertarian-like officials, it’s because we know that they’re the only politicians who intend to rebuke and regulate away power bestowed to their predecessors once they inherit it. In doing so, lowering the possibility of corruption, because the smaller government is, the less opportunity for corruption to occur. In the face of the IRS, Benghazi, and press scandals committed against the AP and Fox News, I sincerely hope you understand why we libertarians have been right all along, and are starting to feel vindicated for making these arguments so many seem to laugh away not long ago.

Do you remember Barack Obama making this commencement address speech at my beloved Ohio State University about a month ago?

The irony of this speech that occurred as all three conspiracies started to break into the mainstream media is chilling. It is exactly why we must only trust a politician who tells us not to trust him/her, not to grant them authority, and not to give up your freedom to their ideas of how we should be ruled.

“Experience has shown, that even under the best forms of government those entrusted with power have, in time, and by slow operations, perverted it into tyranny.”
― Thomas Jefferson

This last election showed that painting those with money out to be people who have unfairly attained wealth at the expense of the masses is sadly resonating here in America. We are supposed to be the land of opportunity; where one can achieve as much success as their imagination, hard work, and risk can take them. Yet once they do, the quasi-socialists of today attack instead of praise, and the masses harbor jealousy and animosity instead of admiration and respect.

One of the arguments that irritates me like sand encrusted toilet paper is the no-one-should-be-worth-that-much argument. Fairytales like Robin Hood and almost every movie with a happy ending have ingrained us to believe that just by being altruistic, hard-working, and smart, you should achieve fame and fortune.

The reality is that Robin Hood would have likely been shot, and rightly so—he’s a thief. Hard work doesn’t come close to guaranteeing you a better living—it most often just leads to more hard work. Altruism is hardly a harbinger of hope for wealth neither. Do you know of any active duty soldiers listed on the Forbes 500 list? Neither do I.

So do the socialists have a point? Let’s apply some logic with a side of skepticism.

Are people who are rich stealing from the poor? I mentioned I don’t know of any soldiers on the Forbes 500, but I don’t know of any career criminals on there either. Contrary to the Hollywood portrayal of high-profile con artists, et al., the fact is that most thieves are broke and about two steps away from a lengthy prison stay. So they certainly don’t make up the 2%.

Are they taking advantage of the poor by paying them less than what they are worth? Anyone with a modicum of understanding in regards to economic history knows that companies competing in a free market yield a better product at a lower cost. But what people so often fail to realize is that employees are competing in a free market too. If a person goes to work somewhere, and the company doesn’t pay well, most go work somewhere else. Companies who have a reputation for thrift eventually only get the dregs of the working world applying, and then it’s not long before they go out of business at the mercy of companies who opted to treat their employees better.

Business moguls of a past era such as Andrew Carnegie, Cornelius Vanderbilt, and John D. Rockefeller were not competing in a free market; they were collusionists and monopolists. But we Americans created laws to protect the consumer from capitalists who endeavored to destroy the free market over a century ago by passing anti-trust laws and prohibiting collusion. There’s likely no one left that has been taken advantage of in such a way.

Andrew Carnegie, Cornelius Vanderbilt, John D Rockefeller

So then why are NFL players paid millions while soldiers are paid modest 5-figure salaries? I’ve struggled with this one for a while, because I don’t feel good about it either. As I racked my brain for answers, it dawned on me that the number one factor in what people get paid is irreplaceability. If we’re talking about entrepreneurs; add risk to that.

I know the anti-capitalists on the left hate corporate bosses, but the fact is that every one who has ever dreamed, has dreamed of owning their own business or being independently wealthy. So let’s logically draw the scenario out. If you started your own company, and within that company you had a need for a job that was fairly rudimentary, would you pay someone a fortune to do it? Of course not. You would hire a person at a low wage, because no matter how dirty, altruistic, or physically demanding that job might be, if you are 99% sure you could train a gorilla to do it, why would you pay anyone more? If the person doing it leaves, it’s pretty easy to plug a new person into the mix and have them trained and running in little time.

However, if your new business involved a biological research lab which required someone with a background in the study of the molecular structure of cancerous cells and how they react to radiation exposure, you can’t just grab a homeless guy off the street and hope for the best, can you?

So when we look at most everyone who is employed, the more money they make is in direct correlation with how easy it would be to replace them. As much as it pains me to say this, many have the abilities required to be a school teacher, police officer, or a soldier. It is not however easy to find a guy who can jump three feet, catch a football in one hand, while being tackled, and yet somehow have the wherewithal to reach out his toes to get both feet in-bounds. It aches my heart to know an athlete makes more than a soldier, but my logic generally holds true.

When it comes to entrepreneurs, I mentioned the addition of risk. Any gambler or stock investor will tell you that if you want to make a million dollars, you have to start with 10 million. Those who have only seen movies about gamblers and investors have been duped by Hollywood into believing that you can put up a dollar and win millions. You might think the lottery disproves this, but the fact is that for every one million won, there are several million lost. Entrepreneurs make money by risking almost all that they have on an idea that they think you the consumer will consider irreplaceable, such as your smart phone that you can’t live without. Therefore, irreplaceability + risk = success.

So the bottom line is that hard work is only a good way to not get fired, altruism is a good way to be loved by many, and intellect is merely a good foundation for success, but only if applied in such a way as to make you more irreplaceable.

If you want to make a fortune, you must find a way to become one in a million. If you really want to make a fortune, put your bank account, home, and first-born at risk and invent something irreplaceable. But all that being said, virtue is its own reward, and as long as you are happy in your career, and you feel good about who you are as a person, try being happy instead of jealous for those who have attained more than you. As long as they did you no harm, there’s no logical reason to advocate taking what they’ve achieved away from them or hating them for achieving a success greater than your own. The American dream isn’t just for you—stop being selfish. If you must have an emotion about them, try being motivated to be like them instead of tearing them down.

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log·i·cal: capable of reasoning or of using reason in an orderly cogent fashion lib·er·tar·i·an: an advocate of the doctrine of free will; a person who upholds the principles of individual liberty especially of thought and action